Which of the following statements regarding the statement of cash flows is true?
A)The statement of cash flows analyzes the changes in consecutive balance sheets in conjunction with the income statement.
B)The statement of cash flows is organized as cash inflows less cash outflows.
C)The statement of cash flows analyzes only the changes in current assets and current liabilities.
D)The statement of cash flows is an optional financial statement.

Question

Quizplus · Accepted Answer

The statement of cash flows is designed to analyze the changes in cash and cash equivalents from one period to the next, using information from both the balance sheets (to see the changes in balances from one period to the next) and the income statement (to adjust for non-cash transactions that affect the company's net income).

Which of the Following Statements Regarding the Statement of Cash